With the institutionalization of Europe's single market during the past decade, the Commission of the European Communities has faced dramatic changes in its policy environment. These include the intensified mobilization of firms and business associations that make new demands on Community regulatory regimes, and the accumulation of European Court of Justice decisions that alter the Commission's regulatory latitude. This essay examines developments in Community regulation of government aid to industry to assess how well the Commission has adapted to emerging constraints on its regulatory capacities. The essay finds that the Commission invited representatives of the national governments of EU countries to legislate conditions for applying regulations on government aid to industry in the mid-to-late 1990s - in a policy area in which the Commission in the past guarded its autonomy closely - not due to pressures from national governments, but as a response by the Commission's state aid policy unit to potential constraints on its regulatory capacities.

Institutions are more than mere agents of their creators. They produce unintended consequences by means of their autonomous action. In the context of the European Union (EU), supranational institutions, such as the European Court of Justice (ECJ) and the European Commission produce such consequences, even in areas where no direct or overt transfer of powers has taken place, while performing the roles assigned to them by their creators. Using a case study regarding the protection of the free movement of workers, this article demonstrates that supranational institutions circumscribe the use of executive discretion by national governements by blurring the line between ‘safe’ and other issues, that is, the line that distinguishes between the ‘two faces of power’.

Globalization is said to restrict severely the state's capacity to fulfill its welfare function in advanced industrial societies. This paper tests empirically the redistributive capacity of the state operationalized as the difference in percent of households who live below 50% of the median income in their respective country before taxes and transfers and after taxes and transfers, based on the latest Luxembourg Income Study data. Besides globalization, specific sets of domestic political institutions predictably and systematically affect the redistributive capacity of the state: what is termed ‘collective veto points’ buoy redistribution by the state, while ‘competitive veto points’ have the opposite effect. Partisan coloration is introduced as a control variable which, surprisingly, does not affect this critical function of the welfare state. The research design is a cross-sectionally dominant panel design (N=15, t=2). This study finds evidence that globalization and collective veto points both positively affect the redistributive capacity of the state while the converse is true for competitive veto points.

When Western counties seek to reform welfare so that recipients have to work in return for aid, this poses implementation as well as policy problems. This study of work requirements in Wisconsin illustrates the challenges. It also confirms success of a top-down model of implementation. Wisconsin's welfare work programs had little impact on dependency through the mid 1980s because work was not a priority and work programs were underdeveloped. From 1985-6, however, the state increased funding and built up the employment bureaucracy. It required that more recipients participate in work programs, enter jobs rather than education, and avoid welfare if possible. It attuned the bureaucracy to its goals through funding incentives. These measures along with strong economic conditions then drove the welfare rolls down, with largely good effects. Wisconsin's achievement rested on its good-government traditions. Not all regimes have the same capacity.

This paper examines the social learning models of policy of Hall and May attempting to create a synthesis of the best elements of each. We then apply the revised model to three specific instances of macroeconomic policy in Britain; the introduction of ‘Keynesian-plus’ policy in the 1960s, the movement from Keynesianism to monetarism, and the experiment with monetarism in the 1980s. In each case study, the degree of policy change is assessed, and possible reasons for that level of change explored. We conclude that a more social constructionist approach is required to understand the link between policy instruments, indicators, and paradigms, and, alongside this, a greater need to understand the implications of the assumptions underlying policy.

The choice of rules for the central government budget process represents a trade-off between potentially conflicting goals. Budgetary reforms triggered by serious imbalances in public finances over the last two decades indicate that a political reorientation has taken place, giving more emphasis to macroeconomic impacts, long-term budgetary restrictions, and transparency in budget decision making. The paper analyses a number of generic problems of collective decision-making in the fiscal policy area and their relation to fundamental values upon which democratic states are built. The discussion is illustrated by experiences from a major budget process reform in Sweden between 1992 and 1997. The conclusion is that tighter fiscal discipline can be achieved without encroaching upon democratic values; it is argued that democracy can in fact be strengthened by such a shift of regime.

The successful performance of the Danish economy in the 1990s has encouraged scholars to talk about a “Danish miracle”. This article investigates why Danish governments have been able to govern the economy so successfully in the 1990s. It argues that two factors have been important. First, the bargaining position of minority governments has been strengthened. Today, Danish minority governments can enter agreements with changing coalitions in the Danish parliament, as a result of changes in Danish party politics and in the functioning of Danish parliamentarianism. The article thus challenges the conventional wisdom about minority governments as weak in terms of governing capacity. Second, the changed socio-economic strategy of the Social Democrats returning to power in 1993 has been important, because it has created a political consensus around a number of controversial reforms.

This article challenges Paul Pierson's account on the (supposedly declining) role of labor unions in the ‘new politics of the welfare state’. More specifically, the text compares labor's influence on the French and the American politics of pension reform since the 1980s. The analysis of recent reforms undertaken in both countries demonstrates the impact of institutions and managerial settings on labor's political strategies. These institutional variables explain the fact that French unions have a much more direct influence on public pension reform than their American counterparts. In France, labor unions have an ideological ‘veto point’ derived from their integration into the management process. Their strong influence on the ‘new politics of the welfare state’ is undeniable: labor still matters.

Cross-subsidization is a frequent topic in public debates and often stigmatized in the wake of deregulation. Public monopolies increasingly find themselves operating not only in regulated markets, but in non-regulated markets where they are accused of illegally using resources from the regulated market to stifle competition. Similar anticompetitive allegations can be made against private multiservice firms with market power. However, definitions of cross-subsidization are many and this affects the debate about the issue and possible strategic motives behind cross-subsidization, its possible consequences for competition, and measures that might be taken against it. This paper organizes definitions that regulators are likely to encounter into three types involving cost transfer, temporary loss or permanent loss. Based on these distinctions, a novel classification framework is developed according to underlying motivation and consequences for competition. The four cases arising from the framework are subsequently discussed in terms of relevancy for public and private firms, and consequences for competition and welfare.

In recent years Denmark has seen a huge corporatization and privatization program. As it is an unlikely reformer, the policy shift makes the country an interesting test case for the analysis of public sector changes. The paper argues that the Danish corporatization and privatization program fits into a general pattern. The program has been successfully implemented because it has allowed the governing coalition to reap important short-term political benefits without compromising a long-term quest for political control. However, these radical changes that together constitute a virtual wave of reforms have been initiated because politicians belonging to the governing coalition have come to the knowledge of new theoretic and empirical insights that open their eyes to short-term political benefits formerly unacknowledged.

This study builds a conceptual framework to guide empirical studies of learning in public policy. Learning in public policy is defined here as a process in which individuals apply new information and ideas to policy decisions. This topic is examined by adapting relevant concepts from studies of organizational learning to the context of public policy. Recent work in the organizational learning literature focuses on institutional structures, procedures, and customs (learning arrangements) that act to promote individual learning. Further work in the policy literature suggests that focusing events (incidents that focus public and political attention on a policy issue) can also shape learning in public policy. Combining insights from these two literatures, this study proposes that both learning arrangements and focusing events can play observable roles in shaping policy change over time. These concepts are developed and examined in the context of hazardous systems.

The number of public policy conflicts has increased sharply in most western democracies, especially in the fields of planning, regional development, and environmental policy. Attempts have been made to find a way out through new forms of negotiation-based conflict resolution. Alternative Dispute Resolution raises high expectations as to its potential for reaching consensual solutions, to be achieved through extended participation, transparency, and procedural justice. However, success or failure of negotiations do not depend only on the procedure, but also on factors exogenous to it. The first section addresses the question: which exogenous factors affect the opportunities for an agreement in public policy negotiations and how do they exert their influence? Spatial representation of bargaining is used as an analytical framework. The second section shows how outside options, exogenous restrictions, and political directives for the negotiators affected the negotiation space and the final outcome in a case of environmental mediation in Germany.

A “bureau-shaping model” is adapted to explain how the head of a control agency can shape its culture by agenda-setting, strategic recruitment and engaging staff in “expression games” through which their reputation depends on the impression they develop of competence and commitment to the core beliefs of the agency. The postwar shaping of a “culture of balanced evaluation” at the New Zealand Treasury (NZT) reflected the hegemony of a market failure paradigm. The NZT reinvented itself in the 1980s so that it would be aligned with a reformist advocacy coalition committed to impose and institutionalize a government failure paradigm. The accumulation of a number of threats to the NZT's authority appear to be prompting another reinvention as its current secretary seeks to bring it more into line with the appreciative leadership style of its centre-left government.